ByMarie Gottschalk, Marie Gottschalk is an associate editor in charge of Asian affairs for World Policy Journal at the New School for Social Research in New York.September 24, 1991

THE failed coup attempt in the Soviet Union has left China's leadership feeling more vulnerable at home and abroad. The Chinese Communist Party, founded 70 years ago with the help of Bolsheviks from Moscow, has been digging in its heels since Mikhail Gorbachev was restored to power. Security has been tightened on university campuses, and Chinese citizens have reportedly been warned to curtail their contacts with foreign visitors, especially journalists.The failed coup was a major diplomatic loss of face for Beijing. China hastily extended its blessing to the new government, only to find itself isolated along with Iraq and Libya, two other countries that had rolled out the welcome mat too quickly. China loathes being isolated internationally, for it has worked hard since the early 1970s to be readmitted to the global mainstream. No matter how insecure the current regime may feel at home, it cannot afford to appear completely unresponsive to outside pressure to improve its human rights record. Should that pressure wane, however, the present leadership will probably not make any significant concessions over the short or medium term, given its alarm at seeing the Soviet Communist Party close up shop virtually overnight. This curious mix of feeling extremely vulnerable at home and yet wanting to be an upstanding member of the global community helps explain Beijing's skittish response the past few weeks to stepped up pressure to improve its human rights record. The first surprise came in August, when Chinese newspapers, in an unusual move, responded to charges that dissidents Chen Ziming and Wang Juntao were being mistreated in prison. Until then the government had refused to comment publicly on the numerous Chinese round ed up in the aftermath of the bloody military crackdown in June 1989. Mr. Wang and Mr. Chen are leading intellectuals who were sentenced to 13-year prison terms last winter for being the "black hands" behind the democracy movement. The two began hunger strikes in August to protest the conditions of their solitary confinement in tiny, filthy, insect-infested cells, and the authorities' refusal to allow visits by their wives. British Prime Minister John Major brought up their cases during his visit to China this month, and the US State Department has expressed its "deep concern." Chinese newspapers acknowledged that both men have been ill and began hunger strikes, but defended solitary confinement as "revolutionary humanism" and vowed that Wang would have to change his "stubborn, reactionary attitude" before prison conditions would improve. The other recent surprise was China's decision to permit a visit by United States lawmakers intent on seeing Chen and Wang. The delegation was headed by Rep. Nancy Pelosi (D) of California, who has been at the forefront of the legislative effort to attach conditions to renewal of Beijing's most-favored-nation trading status. Ms. Pelosi and her fellow lawmakers never got to see Chen or Wang, but they did meet with China's minister of public security. After being told repeatedly that China respects freedom of speech, they tested the waters by unfurling a banner that read "To those who died for democracy" and laying flowers in Tiananmen Square, actions that provoked a minor scuffle with the police. Chinese skittishness has been matched by US skittishness on human rights issues as the US's China policy has ping-ponged back and forth between the White House's soft line and Congress's harder line. This summer Congress passed the Pelosi bill, but not by a veto-proof margin, and President Bush vows to veto the legislation. FOR years now, the US has been in need of a China policy that gives Beijing consistent signals. In light of China's abysmal human rights record, an unconditional renewal of its most-favored-nation status is not in order. The conditions that Congress has attached to renewal constitute a reasonable response and are far less onerous than those imposed in past years on the Soviet Union or South Africa. The Pelosi bill does not call for an abrupt revocation of China's trade status, but rather puts the Chinese government on notice that, come next June, it will no longer be a most-favored nation unless it accounts for those citizens detained in the pro-democracy movement, ends the export to the US of products made by Chinese pr isoners, and releases political prisoners detained during the 1989 demonstrations. Instead of provoking yet another showdown with Congress, the administration should work now to seek a compromise, especially since the legislation looks somewhat more veto-proof in light of recent developments in the Soviet Union.